Privatisation Stinks

The network arm of Telstra should never have been sold by John Howard. If the network arm had been kept in public hands, we would now be well on the way – or have completed – a successful fibre rollout of NBN instead of the mess that Tony Abbott and Malcolm Turnbull have bequeathed to us. If the network business of Telstra had been retained in public hands, it would have rolled out fibre broadband as part of its core business like NZ.
The Hawke and Keating governments sold off the Commonwealth Bank. We are not better off with the privatised CBA leading the race to the bottom in record profits, greedy executive salaries and unethical behaviour? We need to consider again a new ‘peoples bank’ like CBA was before privatisation.
Medicare has operating costs one third of those of private health insurance. But the government is using $12 billion of taxpayers’ money each year to prop up the inefficient and confusing mess called PHI. Our health system is being privatized by stealth through an enormous corporate subsidy to PHI. Medicare was established by the Whitlam Government because of the shambles that private health insurance had become in 1974. It is the same story again today.
Governments facilitated unscrupulous private providers to compete with TAFE with disastrous results. Rod Sims the Chair of the Australian Competition and Consumer Commission said that the mess of the VET-fee scheme with vocational training carried out by the private sector would take two years and counting to clean up.
He has also warned us that privatising the NDIS services could be a repeat of the VET-fee mess.
We sold off natural monopolies like our airports. We should not be surprised that these new private monopolies exploit consumers with excessive charges.
Seven hospitals in NSW and SA were privatised, but then reverted to public ownership because of poor services and high costs.
The NSW government sold Port Botany and Port Kembla to the same buyer, making competition between the two ports impossible. The result was increased rental charges of up to 400%.
The efficient Newcastle container port has been privatised, with a cap placed on its container business in order to protect Port Botany. That is real crony capitalism.
To top it off, the NSW government sold off the Land Titles Office which underpins the whole property system in NSW. It was no surprise when we learned that the new owner attempted to increase some land title fees by 1900%
Other privatisations are attempted through the back door. The federal government says that it will not privatise the ABC despite its federal council proposing just that. Instead the government is cutting funds to the ABC at the behest of Rupert Murdoch and the Institute of Public Affairs that he and Gina Rinehart fund. Further the ABC is subject to continual harassment and intimidation by ministers.
In similar fashion the NSW government says that it will not sell National Parks but starves them of funds to force commercialisation to benefit its political mates.
A major privatisation mess has of course been in electricity generation and distribution. As Tim Colebatch has reported in Inside Story, electricity prices have soared 187% since 2000. He commented ‘the privatisation and deregulation of gas and electricity has failed consumers’
Conservatives tell us that selling off public assets enables government to build new infrastructure. The fact is that as any economist will tell you, the sale of income producing assets like the Land and Titles Office in NSW does not introduce any additional capacity for public investment in non-commercial capital projects.

Whilst conservative and neoliberal ideologues refuse to face the facts, the public clearly understands that privatisation of public utilities that are natural monopolies is foolish.

Privatisation has become the last refuge of ideologues, conservatives and businesses that want a hand out. They refuse to accept the clear public opposition to much privatisation

Society should contain markets and not the other way around. Privatisation is too often put ahead of society and the public interests. And the political friends of ministers jack up prices and cream off large fees.